Monday, August 07, 2006

The Dark Heart of Wal-Mart

From the Houston Chronicle last year, an article about keeping employee tenure short at Wal-Mart. Lots of part-time employees and a high employee turnover rate of 50% a year helps keep wages and benefits down at Wal-Mart. This is the primary basis of their Always low prices. Always business model. Other retailers must do the same to compete with the giant. Wal-Mart suppliers keep costs down by shipping jobs overseas.
Wal-Mart is not alone in struggling with these costs. But its proposed solutions reveal the company's dark heart. It's extracting the cost from those who can least afford it.

Business doesn't look back. Wal-Mart led the charge from the town square to the edge of town. It trained us to believe that the cost of our purchases was all that mattered. Somewhere along the road, the company started believing that, too.

It taught us to expect low prices — always. Chambers' memo shows a company that believes in the low price at any cost.
Wal-Mart makes people poor.
During the last decade, dependence on the food stamp program nationwide increased by 8 percent, while in counties with Wal-Mart stores the increase was almost twice as large at 15.3 percent, according to the study. Although Wal-Mart employs many people living in its communities, for most, the hours worked and the wages paid do not help these families transition out of poverty, the study said.
This article from The Globalist, a syndication of the San Jose Mercury News and the Boston Globe compares and contrasts Wal-Mart with General Motors.
No company of Wal-Mart's size and influence can long remain a truly private enterprise. By its very existence and competitive success, it rezones our cities, determines the real minimum wage, channels capital throughout the world — and conducts a kind of international diplomacy with a score of nations.

In short, the company's management "legislates" for the rest of us key components of U.S. social and industrial policy.

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